Trouble at Porsche as the 911 turns 50

FORTUNE — Nothing like a birthday party to cheer things up. Porsche is celebrating the 50th anniversary of its legendary 911 sports car, providing a brief and fleeting distraction from mounting litigation by hedge funds.

In 1963 the German automaker introduced the first 911 at the Frankfurt Motor Show, the successor to Porsche’s 356. (Some may remember the Speedster version of the 356 as Jane Fonda’s gift to her husband in the 1978 film Coming Home.) No one in 1963 could have guessed how much the 911 would come to epitomize elite style and engineering. The 911 grew into a status symbol — eventually a cliché — for doctors, lawyers, and investment bankers of a certain mindset and pocketbook.

The top-of-the-line version of the 911, which Porsche calls GT3, starts at about $130,000 for the base model. Popular options such as the $9,000 ceramic brakes can add another $20,000 or $30,000 to the sticker. Besides the 911’s performance and engineering, the design of the exterior appeared to many to be balanced, proportional, poised. “With its consistent look over the decades, the 911 has demonstrated, more than any other car, the benefit of clear, brand-specific design,” said Csaba Csere, former editor-in-chief of Car and Driver magazine.

Hedge funds worldwide are suing Porsche SE in Germany, seeking more than $5 billion over the automaker’s abortive bid four years ago to take over Volkswagen AG. VW turned the tables and now controls Porsche — but the legal wrangling over who must pay for the fiasco is mounting. The former chief financial officer and CEO of Porsche are facing criminal charges for market manipulation.

No doubt a few of the same hedge fund managers suing Porsche — VW, actually, now that the German automaker owns the sports car company — are driving 911s, either to their Wall Street offices or on the weekends. They’re arguing in court that Porsche wasn’t clear, as was its obligation, to disclose why it was buying VW stock.

For VW, gaining control of Porsche through unexpected means played into its overall strategy of assembling an array of automotive brands, which create efficiencies and economies of scale. VW has declared it intends to be the No. 1 global automaker in terms of units sold by 2018. “While Porsche’s volume is not large,” Csere said, “it fills the niche between Audi and VW’s exotic Lamborghini and Bugatti brands. Moreover, Porsche emphasizes the German heritage of the parent company.”

Ferdinand Piëch, the chairman of VW’s supervisory board, can gain special satisfaction if he decides to light birthday candles for the 911 this year. He is a member of the Porsche family and worked at the company as a young man. Tension with his cousins led to his exit and a career first at Audi, then at VW. Now Piech wields the ultimate power over what became the company his ancestor Ferdinand Porsche started in 1931 — and a much larger automotive empire as well.